M/S. TITAGARH RAIL SYSTEMS LTD.,,KOLKATA vs. ADIT, CPC, BENGALURU

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ITA 2674/KOL/2024Status: DisposedITAT Kolkata01 April 2025AY 2021-22Bench: us. Accordingly, we restore this issue to the file of the Ld. AO with a direction to examine the same and if the TDS is deducted on behalf of company which is merged with the assessee, then the same is to be allowed to the assessee. With this observation, the ground is restored to the file of the Ld. Assessing Officer to examine the same and decide in terms of our observation given hereinabove.3 pages

AI SummaryPartly Allowed

Facts

The assessee appealed against a disallowance of ₹17,56,707/- by the AO under Section 143(1) for PF/ESI contributions, arguing the issue was debatable. Additionally, the assessee was denied TDS credit of ₹5,81,330/- which pertained to an amalgamating company.

Held

The Tribunal dismissed the grounds relating to the PF/ESI disallowance, holding it to be a prima facie adjustment permissible under Section 143(1) as per the Hon'ble Apex Court's decision in *Checkmate Services Pvt Ltd*. The issue of TDS credit was restored to the file of the AO for re-examination, with a direction to allow the credit if it was for a merged company.

Key Issues

1. Whether disallowance of PF/ESI contributions can be made as a prima facie adjustment under Section 143(1) of the Income Tax Act. 2. Whether TDS credit pertaining to an amalgamating company should be allowed to the amalgamated assessee.

Sections Cited

143(1)

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Cases cited in this judgment

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ACIT v. Ahmedabad Urban Development Authority
143 Taxmann.com 278 · 2022 · SC
379 citing

Income Tax Appellate Tribunal, “D” BENCH, KOLKATA

Before: SHRI RAJESH KUMAR, AM & SHRI PRADIP KUMAR CHOUBEY, JM

For Appellant: Shri S. Jhajharia, AR

For Respondent: Shri Sailen Samadder, DR

Hearing: 26.03.2025Pronounced: 01.04.2025

O R D E R Per Rajesh Kumar, AM:

This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 28.10.2024 for the AY 2021-22.

The issue raised in ground no.1 to 3 is against the confirmation of disallowance of ₹17,56,707/- as made by the ld. AO, CPC, while passing the order u/s 143(1) of the Act and also that the issue is debatable and no addition could be made in the order passed u/s 143(1) of the Act.

After hearing the rival contentions and perusing the materials available on record, we find that the issue is squarely covered by the decision of Hon'ble Apex Court in the case of Checkmate Services Pvt Ltd Vs. CIT [2022] 143 taxmann.com 278 (SC)" against the assessee. Accordingly, grounds raised by the assessee are dismissed.Pertinent

The issue raised in ground no.4 is against the order of ld. CIT (A) upholding the order of ld. AO, wherein the TDS credit of ₹5,81,330/-, pertinent to the amalgamating company was denied to the assessee.

After hearing the rival contentions and perusing the materials available on record, we find that the assessee has not been allowed the credit of TDS to the tune of ₹5,81,330/- by the ld. AO/ CPC. This issue was not adjudicated by the ld. CIT (A) in the appellate order and nor any facts qua the said issue are available before us. Accordingly, we restore this issue to the file of the ld. AO with a direction to examine the same and if the TDS is deducted on behalf of company which is merged with the assessee, then the same is to be allowed to the assessee. With this observation, the ground is restored to the file of the ld. Assessing Officer to examine the same and decide in terms of our observation given hereinabove.